Switch drives Nintendo profits while Comcast bundles up for survival

When Nintendo hits a homerun, they truly hit it out of the park, and the Switch has been the companies latest mega success.

Over 15 million Switch consoles sold last year bringing the number to 17.79 million units since it’s March 2017 release. The Wii U sold less than that at 13.56 million over the course of its five-year production life. Nintendo is forecasting to sell another 20 million Switch consoles between April and March 2019. At the rate they are going, that shouldn’t be so difficult.

Nintendo Co. reported solid sales and profit for the fiscal fourth quarter, powered by brisk demand for its Switch machines. The company also announced Thursday that it will be getting a new president.

Shuntaro Furukawa, director at The Pokemon Company, will replace Tatsumi Kimishima subject to approval at a general shareholders meeting in June.

The move is an attempt to hand over the leadership to a younger generation, said spokesman Kenichiro Matsuura.

Kimishima, 68, will retire and become an adviser to the company. Furukawa, 46, a graduate of Tokyo’s prestigious Waseda University, joined Nintendo in 1994 and has helped oversee global marketing.

Kyoto-based Nintendo has had its ups and downs over the years, but it has recently appeared to be on a turnaround track.

January-March profit for the Japanese maker of Super Mario and Pokemon games totaled 4.4 billion yen ($40 million), reversing a 394 million yen loss racked up the previous year.

Nintendo is getting a lift from strong sales of the Switch, a hybrid game machine that works as both a console and a tablet.

The company said it plans “to leverage this momentum to reach an even broader range of consumers,” pointing to the Nintendo Labo, which it rolled out this month.

Nintendo Labo allows players to use the Switch with cardboard concoctions that enable them to use it as a musical instrument, a fishing rod, and other items.

It’s expecting to sell another 20 million during the fiscal year through March next year.

The company said sales of the 3DS handheld also kept up even after Switch went on sale a year ago.

Nintendo, which brought the world the FamiCom game machine in the 1980s, is projecting a profit for the fiscal year through March 2019 to grow 18 percent to 165 billion yen ($1.5 billion).

For the fiscal year through March, Nintendo recorded a profit of 139.6 billion yen ($1.3 billion), better than what it had expected.

The company said its smart device game software, such as “Mario Kart Tour,” is also performing well. Nintendo had initially shunned games for cellphones and other devices besides its own machines, but has reversed that strategy.

Other such games it has released include “Super Mario Run” and “Animal Crossing: Pocket Camp.”

As Comcast Xfinity has always had a love hate relationship with its customers, it’s transitioning with the times although a little late to the game. As millennials prove that they don’t like long-term commitments with the utility, the cable giant is reconfiguring its model.

Comcast, the world’s largest cable company, and other cable operators are trying to work out new relationships with once fierce rivals in a changing media landscape.

Comcast and others have been trying to build a business that combines both the “pipes” — the internet services that connect everyone — and the producers of shows, movies, and other video.

Cable operators and internet service providers say this business model is key to their survival, given the inroads companies like Google and Apple have made on their turf.

In this environment, Comcast reported a strong first quarter, boosted by $1.6 billion in ad revenue from NBC’s broadcast of the Super Bowl and the Olympics.

Philadelphia-based Comcast’s net income rose 21 percent to $3.12 billion, or 66 cents per share, from $2.57 billion, or 53 cents per share a year ago. Excluding a one-time benefit from the federal tax overhaul and the gain on the sale of an asset, net income totaled 62 cents per share. That beat analyst estimates of 59 cents per share, according to FactSet.

Also on Wednesday, Comcast made a bid for British broadcaster Sky Plc for 22 billion pounds ($30 billion), topping an offer from Rupert Murdoch’s 21st Century Fox and sparking a possible bidding war.

Sky is based in London but has strong news and pay-TV operations across Europe, and is particularly prized for its sports broadcasting operations, including the English Premier League soccer matches.

Comcast has been leading the way in marrying pipes with the entertainment that flows through them. It bought NBCUniversal’s cable channels and movie studio in 2013 and added Dreamworks Animation in 2016. It has been tinkering with the traditional cable bundle, offering a la carte subscription services and so called “skinny bundles.” Earlier this month, Comcast said it will add Netflix to some cable bundles.

The Netflix move was an effort to offer customers more “choice, value and flexibility,” Sam Schwartz, chief business development officer at Comcast Cable said at the time — words not often used to describe traditional take-it-or-leave-it cable bundles.

But combining the distribution of entertainment with its producers has drawn new concerns about monopoly. The Department of Justice is in the middle of a lawsuit against AT&T and Time Warner, claiming that their proposed $85 billion merger would harm consumers.

AT&T and Time Warner argue they’re simply trying to stay afloat in the new streaming environment. But the Justice Department says the merged company could exert monopolistic control — for instance, by charging rivals like Comcast higher prices for Time Warner Channels like CNN or HBO, which would likely push up consumer prices as well.

Jeffrey Lang has joined Movie TV Tech Geeks for 2015 and will be providing his opinion on technology from across the pond in London. Along with having many opinions on tech, gadgets, games, etc., he enjoys watching the Thames from our satellite office there.